Technical analyst Clive Maund charts silver and
discusses the factors that he believes will lead silver upward.
Unlike gold and precious metals stocks, silver did not break out strongly
on Thursday – although it rose, it did not break out at all, nor was volume
exceptional, as we can see on its latest 6-month chart below. However, this
is not a cause for concern, because in the early stages of sector bull
markets gold leads, so we can expect silver to "follow suit"
shortly. This is worth knowing, because it means that it is still possible to
pick up a lot of silver stocks (and ETFs) at knock down silly prices before
it really starts to move.
Silver's latest COT chart, like gold's, is most encouraging too, with the
dumb and wrong Large Specs emboldened to try shorting it again – good luck
with that.
Click on chart to pop-up a larger, clearer version.
Meanwhile the silver Hedger's chart is showing record bullish extremes.
Click on chart to pop-up a larger, clearer version.
Chart courtesy of sentimentrader.com
On silver's latest 10-year chart we can see that the pattern may have
morphed from what we earlier – and erroneously – thought was a downsloping
Head-and-Shoulders bottom into a potential Double Bottom. It should turn up,
especially given what gold and PM stocks did late last week. While this chart
viewed in isolation doesn't look too inspiring, you will feel a lot better
about it after you take into consideration the powerfully bullish COTs and
Hedgers charts that we looked at above.
The conclusion is that it is time to take positions in silver, silver
futures, ETFs and stocks before everyone else gets the same idea. Speculative
short positions in silver are huge and could drive a big spike once silver
really starts to move against them.
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Charts provided by the author.
CliveMaund.com Disclosure:
The above represents the opinion and analysis of Mr Maund, based on data
available to him, at the time of writing. Mr. Maund's opinions are his own,
and are not a recommendation or an offer to buy or sell securities. Mr. Maund
is an independent analyst who receives no compensation of any kind from any
groups, individuals or corporations mentioned in his reports. As trading and
investing in any financial markets may involve serious risk of loss, Mr.
Maund recommends that you consult with a qualified investment advisor, one
licensed by appropriate regulatory agencies in your legal jurisdiction and do
your own due diligence and research when making any kind of a transaction
with financial ramifications. Although a qualified and experienced stock
market analyst, Clive Maund is not a Registered Securities Advisor. Therefore
Mr. Maund's opinions on the market and stocks can only be construed as a
solicitation to buy and sell securities when they are subject to the prior
approval and endorsement of a Registered Securities Advisor operating in
accordance with the appropriate regulations in your area of jurisdiction.
